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Tuesday, June 4, 2013

$SPX - Down Trend from Cycle Point A

SPX overshot the upper red line by time and price practically identical to the Cycle expanding formation.  SPX has declined enough below the red line to confirm Cycle Point A.  As price trends down, numerous bounces are to be expected on the way down to Cycle Point P. 

The Cycle decline has only just begun.  It has been a relatively slow and choppy decline to start.  The Cycle predicts choppy spots, and also during some time periods, rapid declines on the way down to Point P.

60min Chart
















The Deja Vu Cycle expanding formation is shown with the red lines. Notice that there is an overshoot at point A.






Deja Vu Cycle on a larger scale:



















168 comments:

  1. Probably test near the white downtrend line this week, then decline more next week.

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  2. SC, i can tell you right now that the pattern is not going to play out this way. You can not predict the future. The chances are 99.999% against you.

    This does not mean i am against bears in this case.

    ReplyDelete
    Replies
    1. So far it has been consistent with the Cycle turn at A. Therefore, why expect anything different than what the Cycle projects?

      Always open to different views so feel free to share different ideas and evidence.

      Delete
    2. I don't expect much lower in June. July, I do expect much lower for SPX.

      Delete
  3. Room to bounce this week and then lower low for SPX next week around 1610.

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  4. Planning to cover some shorts next week and reshort on a bounce late June.

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  5. Covered my UVXY short from 6.90..

    I agree with '1inbluemoon', impossible to predict the mkt...this cycle is just SC's idea & therefore just a possibility.

    I've made good money trading this year having no bias opinion with the full knowledge that you can't out-smart the mkt.

    Flat book again & waiting for the next opportunity.

    ReplyDelete
  6. By definition SPX is in a downtrend. Lower highs and lower lows. Whereas Nikkei has been very weak May/June, this period into June has been moderately lower for SPX, and based on the pace, July looks much weaker for SPX.

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  7. We're coming up on 3 months that VIX has been rising since mid-March. That is strong supporting evidence to back up the Cycle continuing.

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  8. I think your next week is coming this week!
    Is 1550 your target for covering (or 1580, 1600 on SPX??)

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    Replies
    1. I don't think it is ready to go below 1600. Probably some support there so will look to cover some just above that.

      Delete
  9. Are you looking to cover around 1600 or 1610, thanks?

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    Replies
    1. I'm going to look at the levels some more.

      Delete
    2. I'm going to hold shorts and let things play out some more here. I think next week may be a good time to cover some shorts and then look to reshort later.

      Delete
  10. Ascending Triangle formation on GLD. Looks like gold breaks higher very soon.
    http://stockcharts.com/h-sc/ui?s=GLD&p=D&b=5&g=0&id=p62180826059

    ReplyDelete
    Replies
    1. vs bear flag on falling volume into the apex?

      Delete
    2. miners do look promising, perhaps you are right. just follow break out in either direction.

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    3. Too extended to be a bear flag and volume can't really be considered as it is inconclusive.
      For further confirmation look at GDX, it is leading higher. Volume in GDX is much clearer and decidedly more bullish

      Delete
    4. is there a rule on how long bear flags can be? volume is dropping last 5 days. GDX is against 50DMA which was golden move stopper for last 6months+

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    5. If SPX falls so will the miners...simple as that.

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    6. SnP already ~50pts down since 5/20 and gold is 60$ up.

      Delete
    7. Thats not what I mean...you looking at miniscule percents! If SPX breaks 2009 trendline on weekly & monthly charts...= deflationary.... And PM will follow suit.

      Where was HUI in 2008 crash? In gutter just like everything else. PM are bouncing off oversold condition but primary trend still DOWN until $1900 gold is breached to upside.

      Delete
  11. PayDay

    "If SPX falls so will the miners...simple as that"

    So what is going on since the S@P topped last month?????.....You had better tell GDX it is going in the wrong direction!

    BTW, GDX has been outperforming the metals......doesn't that tell you something?

    ReplyDelete
  12. SC
    Could we be on our way to VIX 23 here? The VIX seems to have moved alot for the type of correction we're getting on SPX? Your thoughts?

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    Replies
    1. Yes, we can see that level for VIX this month, but I notice that VIX today has not surpassed Monday's high. It may be a hint that the market can find some support soon, and another bounce.

      I think VIX may hit 18 resistance, settle back, and then take that run higher.

      Delete
    2. Are you looking to cover today or still waiting for next week? How much more downside you think short term before a bounce?

      Delete
  13. Payday.

    There is a big difference between 2008 and today. In 2008 gold was at the end of a massive move from $500 that began in late 05 and as a result of the GFC gold was liquidated by funds that were holding huge profits to raise liquidity.

    The difference this time around is that the massive sell-off has occurred and there will be a massive amount of capital from stocks looking for an oversold market to park in .......and that would be?....Not to mention the massive short covering that a continued rebound will lead to.

    ReplyDelete
    Replies
    1. beetlejuice, gold market is not going to be the recipient of the capital flows. I agree with deflationary (for metals scenario), until proven otherwise.

      Same old dollar and treasuries might get another bump IF money run away from equities. Dollar has started bull market in early 2013.


      Gold is too volatile for most funds out there. Silver is just pure speculators playground. NOT AN INVESTMENT.

      Delete
    2. Bettlejuice...gold, silver, copper, lumber, etc. commodities have been in contraction mode...leading the stocks down...spx has stalled and will soon follow suit. Only reason spx is up is due to Fed POMO several times a month...but even that cannot prevent deflation

      Gold and miners will bottom first as they did before but not yet as far as i can tell. Long term charts still show more downside $17 silver...$1100 gold

      Delete
    3. I also agree with the statement that gold will receive a fear bid trade when the timing is right and we could still be in deflationary mode!

      Gold volatility broke out big time from multi year channel, big moves in both directions are coming!

      Delete
  14. Watch XIV...important levels at 21 & 19...

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  15. GOLD

    http://traderjoed.blogspot.com/

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  16. SC, are you still looking to cover next week? How much more downside you see from here?

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    Replies
    1. I'm overweight short SPX so will probably look to cover some soon. I think we are close to short term support and probably see another bounce soon. Lower after that.

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    2. Let's see how it goes today. May see a low today/tomorrow.

      Delete
  17. Covered SPX shorts at 1609 from 1667.

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  18. I was overweight short, and I think there may be a short term low soon and bounce to 1640.

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  19. VIX didn't get a higher high today, and is down. 18 has been resistance for VIX.

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  20. So my plan will be to reshort around 1640 SPX for another drop.

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  21. Hi SC, according to your trades, you bought UVXY at about $14.4.

    How long time will you hold your position ? What is your target price to sell your UVXY position.

    Thanks

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    Replies
    1. I am waiting for a spot to add and build a larger position in UVXY. I plan to add in June, just waiting for a few things to line up.

      Target will be in the high teens.

      Delete
    2. What do you mean by "Target will be in the high teens." ?

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    3. $16-20 area is the target area.

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    4. You mean target will be $160-200.... Reverse split tomorrow!

      Delete
  22. Sc, curious why you covered at 1609. Now that A top and upside red convincingly broken to downside, shouldnt spx continue down to 1540?

    Vix looks like its touching right shoulder of inverse H&S at 18.... Head to neckline is 7 pts so if 18 broken that means move to 25 thereabouts. Similarily, XIV broke 21 on its way to 19 to complete R shoulder.

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    Replies
    1. I do think the trend is down for SPX, but a bounce looks probable to me short term.

      VIX has resistance around 18. I think it'll settle back from that level, and then break out later this month.

      Delete
  23. UVXY testing the target resistance area.

    SCJune 3, 2013 at 8:36 AM
    "Market did follow through on the downside, and so probably UVXY can test around $8 which has been resistance."

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  24. SC, what's your current view on Gold/Silver? Are you still planning to take positions on it as you mentioned before?

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    Replies
    1. Yes I'm planning to take positions. I like them but just watching them consolidate sideways.

      GLD is starting to interact with the 50dma which could push it down somewhat. I don't see much downside, yet they could settle off a bit for a good entry level this month.

      Delete
  25. SPX starting to warm up. Looks like that may be the low for a while. 1640-1650 bounce probable in my view.

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  26. Potentially could see VIX all the way back to 13.

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  27. Hi SC

    You plan to enter overweight on UVXY when VIX reach this 13 again and hold?

    Thanks!

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    Replies
    1. if so, UVXY will go back to low 5's (or low 50's)?

      Delete
    2. Yes, that is the plan. I am waiting to load up on UVXY.

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    3. I'm not sure of the UVXY price but next week will look to enter UVXY. SPX around 1650. VIX might bounce from 14's but probably see 13's after.

      Delete
  28. SPX bouncing as suspected yesterday, and I'll be ready to go short again around 1650. Timing maybe Tues/Wed.

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  29. I think UVXY are a buy here....0.618% retracement level.

    Buying for a short term trade.

    ReplyDelete
  30. SC, after seeing the reversal from 1598 yesterday, what are the chances you see the bulls try to push and test the high around 1680 again?

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    Replies
    1. None. SPX 1650 should stall this bounce and next target 1580's this month in my analysis.

      Delete
    2. These Cycles are very bearish going forward, and these types of bounces are to be expected according to the Cycles.

      There will be plenty of bounces for SPX but expect the bottoms to keep falling out in the downtrend.

      Delete
    3. This was a very negative period for Nikkei. SPX was only moderately weak during this time. July, for SPX I am anticipating much more negative.

      The downtrend has just barely started....

      Delete
  31. There is a time much later in this Cycle, after Point P, that SPX is quite positive and could test the May high again. Until then, this downtrend should continue.

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    Replies
    1. "much later" - when will that be, based on your prediction?

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    2. If this is true then why VIX back down to 13's? With SPX at 1580 i'd expect at least 18 VIX and even 30's at Point P = hi teens /160's+ UVXY.

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    3. Probably test 14's for VIX next week imo, and then set to pop again with SPX dropping to 1580's. Might still see 13's after that. We'll see how it goes later this month.

      Yes, at Point I would think VIX in the 30's.

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    4. Basically SPX can stall around 1650, fall to 1580's June and may manage another decent bounce from that level. July freefall.

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    5. Good to have a plan, but best to approach it one step at a time.

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    6. Especially considering the way it is chopping around.

      Delete
  32. Dude, can I post? I promise I will not call you a liar. I just want to congratulate you for finally making a profitable trade for the year.

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  33. Aah I can post! SC got all bend out of shape beause I mentioned all his bad calls. He banned me. Now I congratulate him on his first winning trade, I am able to post again. Good job SC. You are no liar on this trade. Good job!

    ReplyDelete
  34. Thank you for marking the top on S&P within 5 minutes.

    UnknownMay 22, 2013 at 7:26 AM
    It's nice to be the only BULL here. Just move your stops and walk away. Calling TOPS can be a dangerous game.


    ReplyDelete
    Replies
    1. SCMay 22, 2013 at 7:52 AM
      "unknown" marked the SPX top to within 5 minutes!

      Delete
    2. Nikkei topped May 22nd and then crashed 23% in 2 weeks.

      Delete
  35. Well boys & girls....who is right & who is wrong is totally irrelevant in mkts.

    To be fair the guy had a stop, he may have bought at the top but at least he used good management & hopefully for him it was just another trade. We all do bad trades.

    The only thing that is important in this game is MAKING MONEY, NOT BEING RIGHT OR WRONG.

    Emotion has no place in the mkt...I may disagree with what other traders do but I don't have to voice my opinion.

    Up for the week, that's all that matters...

    ReplyDelete
  36. SC fail to post the comments I made by being stop out. Btw, I did buy the dip again at 1600 level. How's that for a trade SC? Of course, you fail to post that also. I do agree there is a shorting opportunity coming up. If we make higher highs on negative divergence, I will be on your side. If we take out recent lows, the game has change. You see, I can be a BEAR too.

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  37. Btw, I will not call you a LIAR anymore. I know that must hit your button. So no more name calling. Btw, do you still own UVXY? How much are you up on it?

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  38. I'm planning to get aggressive with UVXY next week. The UVXY trade will be understood in July when the S&P is due to freefall 300.

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    Replies
    1. SC, Do you mean a 300 point drop on SPX? What target are you looking for on VIX next week, still low 14s?

      Delete
    2. Yes, July date. I'll discuss the date with charts later.

      For this week I think SPX can move up some more into around Wed, and VIX lower. VIX did test the high 14's briefly Friday.

      Delete
  39. 60.70 is 0.76% retracement of the 3rd wave....I'm buying today for a small tick up later this week.

    My view is we go to 1700 but we should get a pullback to 1625ish before we push higher again.

    Tight stops as always.

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  40. WOW! Spot on...I bought at 60.80.

    Sold half at 62.

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  41. Sold other 50% at 62.50....flat again.

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  42. Any ideas why UVXY aren't holding? Very weak here & has passed the 0.76% retracement level....

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  43. SC
    This is the other Phil
    Looks like we've reached the white downtrend line. Any new targets on VIX and SPX this week. Thanks for posting your cover for the SPX last week. That was helpful!!

    ReplyDelete
  44. We were due for a multi-day bounce for SPX. I continue to think it'll peak mid this week. Not much price left but a couple more days. Probably go just over 1650.

    UVXY is soft today probably foretelling that the rally has a little time left.

    I'll be putting shorts in place this week.

    ReplyDelete
    Replies
    1. Jun 11 is an astrological turn date so I think any anticipated decline should likely start either on Tues rather than Wed or by early morning Wed at latest. It is a Ceres-Venus conjunction 36 degrees. FYI. I know nothing about astrology so don't ask me!

      Delete
    2. Thank you, watching for a setup soon.

      Delete
  45. SC, just for fun.

    UVXY from it all time high is more expensive than BRK.A high. almost double BRK.A lol


    Thanks!

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  46. Lol, nice! A lot of leverage for cheap down here....

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  47. I will have charts coming for UVXY, am waiting for the programs to adjust for the new price.

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  48. SC, are you planning to start the short positions today? Do you still see the VIX move down to the 14s?

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    Replies
    1. Market slumped overnight. I'll wait and see how things shape up next. Will be looking to increase short positions to overweight soon.

      Delete
  49. Looks like mkt breaking out....sucking all the bears in once again...

    1700 here we come.

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  50. SC, many are starting to say the IHS in play, do you still see the 1950 area would be the for this bounce?

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    Replies
    1. I mean 1650 area still be the high?

      Delete
    2. I see that pattern. It is not clear today that the market is rolling over yet short term, but from May the bounces are within a downtrend in my view.

      Delete
  51. Hi SC, so we are at mid-week dip instead of pop, is you plan to add UVXY this week still on ?

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  52. The tricky part about this market is that it is jolting around up and down above the 50dma for SPX right now. We're seeing pops and dips every day.

    I think there is a decent chance of SPX testing 1650 again, but we'll see. For UVXY may be support at $65 so maybe have a chance there...

    ReplyDelete
  53. Frustrated because my charts were not adjusted for the split on Monday, and of course the market fell apart Monday night. Murphy's law when it comes to trading.

    ReplyDelete
  54. any idea what UVXY is pre split? The roadmap is looking darn good, called way in advance.

    http://1.bp.blogspot.com/-8jgeD0aLkVc/UUZ5HdpzOnI/AAAAAAAAAQ0/JrXOsP7gYRc/s1600/2013+Primary+S&P+Roadmap.JPG

    ReplyDelete
  55. Replies
    1. I see, so current UVXY is at $7.51. Thanks.

      Delete
  56. SC you mention that your next target is 1580 on SPX after hitting 1650's. According to your analysis is there a big bounce at 1580?

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    Replies
    1. That is my best scenario right now. Probably flat now for a few days, drop to 1580's in a week or so. Then SPX could bounce right back up to test 1650. July plunge from 1650.

      Delete
    2. SC, do you still plan to take short positions in the next few days even if 1650 not reached?

      Delete
    3. Yes, I am thinking may look to short around 1630ish this week for drop to 1580-1590 this month.

      Delete
  57. SPX is still above the 50dma so should be support in the 1605 to 1610 range for the short term anyways.

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  58. I think VIX settles back here for a few days then could reach 23 with SPX 1590.

    VIX can cool off after that again.

    ReplyDelete
  59. Sc
    Are u seeing the asia market? More down side. U dont think tomorrow vix will go even higher?

    Thanks!

    ReplyDelete
    Replies
    1. Yes, I'm watching the Nikkei now. VIX should still have some short term resistance around 19 though I think. Let's see how it looks in the morning.

      Delete
  60. Hi SC:

    Do you look at currencies by any chance? Would like to hear your take on the dollar and the euro is possible. Thanks tons.

    ReplyDelete
    Replies
    1. Hi,

      I'm not really up to speed on their short term levels or movements currently.

      The Cycles I use can be applied to currencies or any other market. I just haven't done that much with them lately. I should really take some time and look closer here. Thank you.

      Delete
  61. SC, wow, we may not even have to wait next week to see your 1590.

    ReplyDelete
    Replies
    1. I think trade in the 1605 to 1620 range for a couple days and then drop down to 1580 to 1590. That should be a low and bounce right back to 1650.

      The decline in this Cycle model has barely even started and another opportunity coming at 1650 again.

      Delete
    2. I may look to short some around 1620 for drop to 1580 to 1590.

      Delete
    3. Or could just wait for the better spot at 1650.

      Delete
  62. SC, nice call, we back at the 1620 now, with Fed and Helicopter Ben next week, what are the chances you see SPX 1640 again?

    ReplyDelete
  63. I think there is a lot of resistance SPX 1625 to 1630. Still expect this to stall and drop to 1580 to 1590. After that low, yes, we can see up to 1660.

    ReplyDelete
    Replies
    1. Are you still looking to trade UVXY for this drop to 1580?

      Delete
  64. Yes I am watching for a spot to pick up UVXY today/tomorrow.

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  65. I think VIX could come down a bit more then pop to 22 with SPX drop to 1580 to 1590.

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  66. VIX looks it it may try to test 15 again. So decided to wait to short SPX until VIX looks ready.

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  67. Market is jolting around. Will see how things look tomorrow or Monday.

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  68. SPX bouncing very strongly. The concern for shorting was that this bounce is so strong it looks like it could be the bounce up to 1660.

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  69. This comment has been removed by the author.

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  70. GOLD

    http://traderjoed.blogspot.com/

    ReplyDelete
    Replies
    1. joed, i think im on the same page. whats not clear yet if the low is already in or we got one more wash out next. you think we can still push it lower in the next few sessions?
      thank you.

      Delete
    2. AM...........

      I am not concerned about a wash out although time has the larger cycle yet to navigate into! SO my focus is now on a smaller chart watching for the entrance! Good trading! joed

      Delete
    3. ok. whats the timing for your larger cycle if not a secret? i have a 6/13-6/14 window im looking at for the bottom on shorter one.

      thanks!

      Delete
  71. Futures tested low enough Wed night, and SPX bounced strongly yesterday so this probably continues to run higher to 1660. VIX 13's.

    I'm going to wait for next week. Just simply waiting to short.

    ReplyDelete
  72. SC, VIX 13's you mean for VIX cash or future?

    Thanks

    ReplyDelete
  73. VIX cash heading for 13.xx, and that is when I will load UVXY to the maximum.

    ReplyDelete
  74. They sure are not making it easy for both sides here. Do you still see 1660 next week, maybe before the Fed, SC?

    ReplyDelete
    Replies
    1. Yes, very choppy. I believe it bounced so much yesterday that it does confirm a move higher to 1660 area next week.

      Delete
    2. That test of 1590 not impossible, but should see bounce to 1660 even in that scenario anyways.

      So next week should be interesting in any case. I'm staying neutral here just waiting for a clean setup.

      Delete
  75. SC, do you see the VIX settle back to the 14s?

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  76. SPX is likely heading up to 1660 which should put VIX into the 13's.

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  77. Very important charts coming...

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  78. There should be resistance around 1650, but probably push above that later in the week to around 1660.

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    Replies
    1. 1660 should be the max target, you don't see them take out the previous high right?

      Delete
    2. 1660 max, and turn down at that level.

      Delete
  79. Hi SC

    we are less than 20 points away from your target.

    wondering how you see VIX drop to 13 within less than 20 points away from your target? Given today rise, VIX isnt dropping a whole lot, mere 1%ish.


    Thanks!

    ReplyDelete
    Replies
    1. VIX is holding today but into the 13-14 range is realistic with complacency building up this week.

      Delete
    2. Hi SC

      I can see 14-15 range more realistic at this point given today strength. Would you consider loading in that range as well? or you plan to enter in the 13-14 range for sure?


      Thanks!

      Delete
    3. I'm going to load up UVXY when VIX is 14 or below. SPX 1660 or so.

      Delete
    4. Hi SC

      What price would UVXY be when VIX is near 14 or SPX near 1660 that you are targeting?


      Thanks!

      Delete
    5. I'm not sure exactly, but there is a gap at $62 to $63.

      Delete
  80. Hi SC
    we are less than 10 points away from your target of 1660. VIX is not where near your target though, wondering if you have your trigger finger ready to pull and enter the short setup? :)
    Thanks!

    ReplyDelete
  81. I'm going to give it some time. Still would like to see SPX a little higher and VIX lower.

    Let's see how things shape up over the next day or two.

    ReplyDelete
    Replies
    1. Hi SC

      I dont know if you watch news, but lot of streamer is saying Ben may taper the QE and drop the market tomorrow. And other is saying he wont, and market will continue to bounce.

      What your take on tomorrow action?

      Thanks!

      Delete
    2. My take is that the market should still head higher short term. Not sure if that will happen before or after tomorrow. Once the market is high enough and the VIX looks right I'll short it.

      Delete
    3. VIX is being stubborn.

      Delete
    4. yeah it beyond frustrating to see that kind of strength in VIX while we go higher.

      Delete
    5. The VIX should still cool off short term, but I think the VIX acting that way is a warning about the health of the market.

      Delete
  82. VIX/VXX will probably not cool off b4 the FED. This event is priced in vol now. Maybe a big move down on vols if we get a rally on SPX after the FOMC.

    ReplyDelete
  83. Hi SC

    you loading soon? :) we might get that 14 ish VIX today

    Thanks!

    ReplyDelete
    Replies
    1. VIX finally cooled off somewhat. Watching and waiting...

      Delete
    2. Hi SC

      UVXY went to 62 ish. you got in?


      Thanks!

      Delete
    3. Still just watching. A lot of whipsawing going on.

      Delete
  84. SC, Do you still see we could reach the 1660 area? If so, when do you think we will see it, later this week, or next week?

    ReplyDelete
    Replies
    1. It's still possible this week. I think it is important that 1620 holds.

      Delete
  85. Sc, need new charts or just new thread. 167 posts too much to scroll on mobile. Thanks!

    ReplyDelete
    Replies
    1. Thank you. Update for VIX has been posted.

      Delete